DOCUMENTATION

RISK ALGORITHM

Comprehensive documentation of our multi-chain token risk assessment algorithm. Learn how we analyze 10+ risk factors across different blockchain networks to provide accurate security scores.

ALGORITHM OVERVIEW

Our risk assessment algorithm is a sophisticated multi-factor analysis system that evaluates tokens across multiple blockchain networks. It combines on-chain data, smart contract analysis, and market metrics to generate a comprehensive risk score from 0-100.

0-30

LOW RISK

31-60

MEDIUM RISK

61-100

HIGH/CRITICAL

10 RISK FACTORS

1. CONTRACT SECURITY

Analyzes smart contract code for vulnerabilities, malicious functions, and security risks.

• Honeypot Detection: Checks if tokens can be sold after purchase

• Ownership Analysis: Verifies if contract ownership is renounced

• Proxy Contracts: Identifies upgradeable contracts that could be modified

• Hidden Functions: Scans for mint, burn, or blacklist capabilities

WEIGHT: 25%

Highest priority factor - critical for token safety

2. LIQUIDITY

Evaluates available liquidity and lock status to prevent rug pulls.

• Total Liquidity: Minimum $10K required for low risk

• Lock Status: Checks if liquidity is locked or burned

• Lock Duration: Longer locks = lower risk

• LP Token Distribution: Analyzes liquidity provider concentration

WEIGHT: 20%

Essential for preventing rug pulls and ensuring tradability

3. HOLDER DISTRIBUTION

Analyzes token holder concentration to identify centralization risks.

• Top 10 Holders: Should hold less than 50% of supply

• Whale Concentration: Identifies large holders who could dump

• Total Holders: More holders = better distribution

• Creator Holdings: Checks if creator holds excessive supply

WEIGHT: 15%

Prevents manipulation by concentrated holders

4. TRADING VOLUME

Assesses trading activity and market interest over time.

• 24h Volume: Minimum $5K for active trading

• Volume Trend: Consistent volume indicates real interest

• Volume/Liquidity Ratio: Healthy ratio prevents manipulation

• Transaction Count: More transactions = more activity

WEIGHT: 10%

Indicates genuine market interest and liquidity

5. BUY/SELL TAX

Analyzes transaction fees

WEIGHT: 8%

6. TOKEN AGE

Evaluates contract maturity

WEIGHT: 7%

7. MARKET CAP

Assesses token valuation

WEIGHT: 5%

8. PRICE VOLATILITY

Measures price stability

WEIGHT: 4%

9. SOCIAL PRESENCE

Verifies community activity

WEIGHT: 3%

10. AUDIT STATUS

Checks for security audits

WEIGHT: 3%

CHAIN-ADAPTIVE WEIGHTING

Our algorithm adapts factor weights based on the blockchain network, recognizing that different chains have unique characteristics and risk profiles.

ETHEREUM & EVM CHAINS

Standard weighting with emphasis on contract security (25%) and liquidity (20%). GoPlus API provides comprehensive security analysis.

SOLANA

Adjusted weighting due to different architecture. Uses Helius DAS API for enhanced transaction data. Holder distribution weight increased to 20% due to better on-chain visibility.

MEME TOKENS

Baseline +15 risk penalty applied. Volatility weight increased to 8%. AI classification identifies meme tokens based on name, symbol, and market behavior.

SPECIAL CASES

STABLECOINS

USDT, USDC, DAI, and other major stablecoins automatically receive LOW risk scores (0-20) due to their established nature and regulatory backing.

OFFICIAL TOKENS

Tokens verified on CoinGecko with market cap over $50M receive -10 risk score adjustment due to established legitimacy and market presence.

DEAD TOKENS

Tokens with zero liquidity, zero volume, or zero transaction count are automatically flagged as CRITICAL risk (95-100) regardless of other factors.

DATA SOURCES

MOBULA API

Primary source for market data including price, volume, liquidity, and market cap across all chains.

Real-time pricing • Multi-chain support

MORALIS API

Blockchain transaction data, holder information, and historical analytics for EVM chains.

Transaction history • Holder data

GOPLUS API

Comprehensive smart contract security analysis for EVM chains including honeypot detection.

Contract security • Risk flags

HELIUS API

Solana-specific data including DAS API for enhanced transaction analysis and holder information.

Solana transactions • Enhanced data

AI INTEGRATION

Our algorithm is enhanced with AI-powered analysis using Groq (Llama 3.3 70B) and Google Gemini as fallback.

MEME TOKEN DETECTION

AI analyzes token name, symbol, and market behavior to identify meme tokens and apply appropriate risk adjustments.

RISK EXPLANATIONS

Natural language explanations of risk factors, helping users understand why a token received its score.

PATTERN RECOGNITION

Identifies suspicious patterns in trading activity, holder behavior, and contract interactions.

Algorithm version 2.0 • Last updated: January 2025